Most of the time small businesses stay small or simply go out of business unless they last beyond a set period of years (typically five in my experience) or are very organized and can effectively reach their target market.

In fact, according to the Small Business Association (SBA), 30% of new businesses fail during the first two years of being open, 50% during the first five years and 66% during the first 10[1].

Reasons for Small Business Failure

The reasons for the high rate of failure (bankruptcy being a leading cause) can be varied depending on the business, demographics, people involved, but usually it comes down to simply not knowing what to do and then not being able to properly execute or perform what is needed to grow, scale (which means invest into the business so it can grow faster), and become known by a wide enough base of consumers or potential customers. One of the reasons Amazon’s become so successful and so hugely profitable is that it is a master of scale. Jeff Bezos, the owner of Amazon, is famous for reinvesting profits back into the business so he can buy up more warehouses, hire more staff, or buy other businesses such as Whole Foods, so they can grow faster and have more distribution reach.

If we look at most small businesses by comparison, most small business owners do not have websites, and do not use digital marketing, or SEO (Search Engine Optimization) in any way.

The irony here is that businesses who need the help the most, are also statistically the least likely to actually accept the help or take advantage of opportunities that could catapult them past competitors.

When I was a business mentor for a certain government agency and several other nonprofit organizations off and on for almost a decade, I advised hundreds of business owners around the US; from lawyers to college presidents, to manufacturing company owners to florists. Most were good people but almost all were trying to manage their own business (such as be a lawyer, doctor, mechanic, accountant, etcetera) while also trying to learn how to build their own company website, studying SEO, trying to master marketing, social media content distribution, video production, all while also maintaining a family life. Where they were needed most – the day to day operations of the business and talking with clients or customers – they weren’t available.

Now, I’m not saying this scenario is everyone.

What I am saying is that based on experience working with hundreds of different types of business owners over a span of twenty odd years and volunteering as a business mentor for several agencies and organizations, is that it is very common. Rather than running their business, their business is running them.

Reversing Small Business Failure

Help is there. Take advantage of it. Most won’t. It’s vital to read everything you can find on how to actually start a business, scale a business, find ideal consumers, find your market vulnerability (or niche), and learn the skills needed to become a “lean mean” business machine, form strategic partnerships, and market.

Read as many books on the nuts and bolts of running a business (I used to read one per week for several months at one time), watch documentaries, interviews with established business owners from Ivy League institutions like Brown, Duke, Harvard and Stanford online, watch educational webinars, spend time talking to experts (with related credentials and experience), study how to manage time and varying schedules, prepare for meetings in advance especially with potential investors, write out agendas, and so on, are all vital.

It’s like learning a foreign language, only with a language there are commonly-held principals. In business you have to consume more volume so you can tell who’s opinion is based on experience, who’s puffing up their chest with hot air, and who may have had experiences not relevant to your situations or business or demographics.

That’s a start.

Personally, I toiled in “boiler room” agencies for decades before going off on my own and even then it wasn’t easy. I had to learn how to do the things that agencies had done for me (whether well or not): negotiate contracts, work with clients (whether organized or not), factor budgets, build the type of work needed to deliver results, learn how to screen for fit, then learn how to train clients so they could be helped faster and easier and in greater numbers.

So it’s really advisable to study, read, take in anything and everything that looks relevant, while studying and running your own business and wait before spending money on something unless you see immediate Returns on Investment potential. Where should you start? Read everything you can find here, ask for help when it’s being offered, take notes, and find solutions for whatever doesn’t make sense.

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